UK support for small firms: an examination of business advisors' heuristics

Abstract

Ibis thesis concerns business advice to small and medium sized businesses (SNIEs). SNIEs account for the overwhelming number of businesses in OECD economies. Consequently, governments have come to see the SNIE sector as increasingly important to 'national competitiveness' and job creation, and therefore explored measuresupport the sector. In the UK, government business support was channelled through the Business Links service, with a remit to support growth businesses. As part of Business Link a personal business advisor (PBA) service was developed to tailor SME assistance to the individual needs of small business, rather than offer a fixed set of programmes. 'Ibis has required PBAs to be able to identify the needs of individual businesses rather like a general practitioner before referring 'patients' to specialists. 'Mese complex assessments require advisors to make heuristic judgements and this research was interested in how they did that. The research used a qual-quant methodology. Research interviews with business advisors, where business advisors were deffied widely to include accountants and bank managers, elicited a set of heuristics developed into a theory of what advisors look for in a well-managed business. Ibis theory informed a survey of 175 PBAs in Business Links in England and Wales. The research suggests that SNIE performance is seen as non-sector specific. Good management is indicated by control, both financial and non-financial, with congruent objectives and strategy. 1hus PBAs are more concerned to identify and reinforce good management rather than promote a growth orientation.